Ireland’s families are being pummeled by electricity prices that are far out of proportion to those in other parts of Europe. But it’s just been revealed that energy prices have soared out of proportion to inflation trends, meaning that families are €360 worse off each year than their European counterparts. This isn’t just a case of Ireland having a few bad breaks – it’s a case of the country’s energy policy failing.
Irish electricity prices soar above European peers
Energy prices in Ireland have gone utterly bonkers over the last thirty years, and we’ve left the entire EU trailing in our wake, since Irish consumers pay around €360 a year more than the average for the entire EU, as shown by the Nevin Economic Research Institute. The price of electricity has increased over four times since the beginning of January 1996, while no other member of the EU15 group has raised costs three times.
Ireland is an enormous “cost growth outlier” relative to other EU15 countries, and it shows how bad things have become relative to Europe. The regular prices in Ireland were keeping pace with the average levels of Europe fairly well, whereas the price of energy had gotten utterly out of hand relative to these levels. The regular prices in Ireland only doubled, making the energy prices even more ridiculous by comparison.
Natural gas dependence increases pressure on gas prices
Irish obsession with natural gas for electricity generation means that a direct gas pipe is connected between international gas markets and Irish energy bills. The current regulatory system connects wholesale electricity prices with gas prices. This means that Irish consumers have become pawns in international energy markets. The ‘stupid dependence’ means that any increase in international gas prices is immediately passed on to Irish consumers.
In Ireland, deregulation in the 1990s turned electricity, which was a social service, into a money-making machine for greedy corporations. This is just plain disaster waiting to happen, as it led to Ireland, which had the lowest electricity prices in Europe in 1990, becoming one of the priciest in 2025 because of this free market philosophy that can completely royally screw over consumers if their politicians don’t watch out for them.
Market Structure causes consumer exploitation
Ireland’s mini-grid is only making every problem worse by virtue of being a mini-grid that cannot benefit from economies of scale, but it also has to keep its size limited so that the fixed costs can be distributed over a relatively low amount of produced power, and also because Ireland is not fully integrated with the neighboring power grids so that it can import cheap power from a country that has its policies right.
The recovery of Ukraine is lagging behind other European countries
Every country in the EU had been affected by the rise in energy prices when Russia invaded Ukraine in 2022, but it is a pathetic situation to be saying that the recovery in Ireland has been so much slower than in others. It is a known fact that a drastic decrease in the price of energy was noted in most of Europe once the effects had been overcome, while the price of energy in Ireland has been so high for a much longer period of time.
The gap that exists between Ireland and Europe points out a number of deficiencies in the current structuring and operation of the energy sector. The issue here is with the dependence on gas energy and the system that has a natural tendency to transfer any changes in gas prices to consumers. The issues with energy policy are such that they call for drastic surgery aimed at cutting dependence on fossil fuels while putting in place a price system that serves consumers despite the forces of globalisation.
